Schwab Advisor Services is “aggressively hiring” service people to work with advisors and their clients as it completes its acquisition of rival TD Ameritrade, executives from both firms said during a press conference today.

“We are hiring a significant amount of client facing employees. We’re happy that we’re getting more folks in all our locations to support the business,” John Tovar, Managing Director, Wealth Management Services, TD Ameritrade integration told reporters.

“We are actively hiring on both sides of the integration. There have been zero layoffs on the service side on the advisor custody business. In fact we’re hiring,” Tom Bradley, head of Schwab's TD Ameritrade Integration, added.

Charles Schwab announced in November 2019 that it would acquire rival TD Ameritrade in an all-stock transaction valued at the time at $26 billion. Together, the firms would hold more than $5 trillion in client assets and 24 million brokerage accounts, the firm announced.

The deal was finalized October 6, 2020.  “So it does feel like this has been a long time in the making, but it’s been only 5 months that we’ve been able to dig into each other’s businesses. The actual integration will take 18 to 36 months,” said Tovar. Schwab recently surveyed all advisors who will be impacted by the merger to find out their top concerns.

It turns out that advisors’ fear of having to repaper all of their clients with new account forms and disclosures is their chief concern, according to advisors’ 1,600 responses. “Our team has gone through a significant portion of accounts and it looks like there is no [new] repapering or signatures required on any accounts,” Bradley said. “There are some atypical account types that we’re looking at and we’ll circle back to these advisors when we finish our work.” 

Schwab executives said they plan to send negative consent notification to clients when the integration is finalized, so that clients will be moved to Schwab’s platform unless they decline. Tovar said using negative consent has worked well “a number of times in the past.” 

Not surprisingly, advisors are also worrying about if whether or not they’ll be able to keep their existing broker-dealer service teams.

We are “not making any guarantees that advisors will keep their same service teams,” Bradley said.

While that may sound ominous, Schwab executives said they plan to keep most teams in place and to grow them. For example, they plan to keep their Schwab San Diego service location “because we want to keep that talent,” Bradley said.  They haven’t made up their mind yet about the TD Ameritrade service center in Texas, “but we anticipate that we’ll be able to retain a lot of that talent. We anticipate very little disruption,” he added.

“I’m not guaranteeing the same service team…but if they have a designated service team now, they will have a dedicated service team at Schwab,” Bradley said. “I think there will be very little changes.”

The largest advisory firms generally have their own service staff and dedicated service staff at their broker-dealer and that won’t change, Bradley added. Mid-size advisors may share a team and small advisor firms will have access to a service team, but generally prefer to work digitally, he said..

“When you get into the advisors that are generally under $100 million dollars they interact with us mostly digitally and go into what we call a networked environment. This seems to work extremely well and we get extremely high service scores from them,” Bradley said.

“We’re constantly looking at how we service advisors and constantly refining it. It’s our objective that they are absolutely thrilled with us,” he added.

To keep advisors informed of how the integration is progressing, Schwab created a dedicated website for professionals: www.welcome.schwab.com.